20201006Application.pdf

Y ROCKY MOUNTAIN
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Salt Lake City, Utah 84116
October 6,2020
ELECTRONIC DELIWRY
Jan Noriyuki
Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd
Building 8 Suite 330
Boise,lD 83714
RE: CASE NO. PAC-E-20-13
IN THE MATTER OF THE APPLICATION OF ROCKY MOUNTAIN POWER FOR
APPROVAL OF A CAPACITY DEFICIENCY PERIOD TO BE USED FOR AVOIDED
COST CALCULATION
Attention: Jan Noriyuki
Commission Secretary
Please find for filing Rocky Mountain Power's Application in the above-referenced matter along
with confidential work papers.
Informal inquiries may be directed to Ted Weston, Idaho Regulatory Manager at (801) 220-
2963.
ery truly yours,
"^..D
Vice President, Regulation
Emily Wegener
1407 West North Temple, Suite 320
Salt Lake City, Utah 84116
Telephone No. [phone]
emily.we gener@oacfi corp.com
Attorneyfor Roclgt Mountain Power
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF ROCKY MOUNTAIN POWER FOR
APPROVAL OF A CAPACITY DEFICIENCY
PERIOD TO BE USED FOR AVOIDED COST
CALCULATIONS
CASE NO. PAC-E-20.I3
APPLICATION
Rocky Mountain Power, a division of PacifiCorp ("the Company"), in accordance with
Idaho Code $61-502, $61-503, and RP 052, hereby respectfully submits this application
("Application") to the Idaho Public Utilities Commission ("Commission") in accordance with
Order Nos. 32697 and 32802 in Case No. GNR-E-I 1-03, for approval of the capacity deficiency
period determination to be used in avoided cost calculations using the Surrogate Avoided Resource
("SAR") methodology. As more fully described below, this update identifies Rocky Mountain
Power's capacity deficiency period in the summer of 2029 and explains how the deficiency period
was identified. [n support of its Application, Rocky Mountain Powcr states as follows:
l. Rocky Mountain Power is authorized to do and is doing business in the state of
Idaho. The Company provides retail electric service to approximately 84,000 customers in the
state and is subject to the jurisdiction ofthe Commission. Rocky Mountain Power is a public utility
in the state of [daho pursuant to Idaho Code $ 6l-129.
COMMUNICATIONS AND SERYICE OF PLEADINGS
2 Communications regarding this Application should be addressed to:
Ted Weston
Emily Wegener
1407 WestNorth Temple, Suite 330
Salt Lake city, utah 84116
Telephone : [phone]
Email: ted.weston@pacifi corp.com
em i ly.we qe ner @pacifrcorp.com
Ron Scheirer
825 NE Multnomah, Suite 600
Portland, Oregon 97232
Telephone: (503) 8l 3-6484
Email: [e-mail]
In addition, the Company respectfully requests that all data requests regarding this matter
be addressed to one or more of the following:
By e-mail (preferred)
By regular mail
datarequest@pacifi corp.com
Data Request Response Center
PacifiCorp
825 NE Multnomah, Suite 2000
Portland, OR 97232
BACKGROUND
3. Commission OrderNo.32697 directed the utilities to initiate a case outside of their
Integrated Resource Plan ("IRP") filing to establish the capacity deficiency period to be used in
the utility's SAR methodology:
"We find it reasonable and fair to subject each utility's determination of capacity deficiency
to further scrutiny. Therefore, when a utility submits its Integrated Resource Plan to the
Commission, a case shall be initiated to determine the capacity deficiency to be utilized in
the SAR Methodology. The capacity deficiency determined through the IRP planning
process will be the starting point, and will be presumed to be correct subject to the outcome
of the proceeding."l
1 In the Matter of the Commission's Review of PUWA QF Contract Provisions Including the Sunogate Avoided
Resource (SAR) and Integrated Resource Planning (IRP) Methodologies for Calculating Avoided Cost Rates, Case
No. GNR-U-I l-03, Order No. 32697, p. 23.
2
4. In Order No. 32697, the Commission acknowledged that oosome determinations
made within the IRP process have an impact on calculations under the SAR and IRP
methodologies. Specifically, the IRP process determines when the utility will experience a need
for new capacity."2 The Commission ordered that payments to qualiffing facilities ("QFs") should
recognize the utility's capacity needs, stating:
"In calculating a QF's ability to contribute to a utility's need for capacity, we find it
reasonable for the utilities to only begin payments for capacity at such time that the utility
becomes capacity deficient. If a utility is capacity surplus, then capacity is not being
avoided by the purchase of QF power. By including a capacity payment only when the
utility becomes capacity deficient, the utilities are paying rates that are a more accurate
reflection of true avoided cost for the QF power."3
REOUEST TO ESTABLISH SAR DEFICIENCY PERIOI)
5. On October 18, 2019, Rocky Mountain Power filed its 2019 IRP with the
Commission. The 2019IRP includes the results of the Company's Capacity Loads and Resources
without Resource Additions in Table 5.12 on page l15. The capacity balance is calculated for
summer peak loads only, with the summer peak occurring annually in July, as the Company is
expected to be deficient in the summer prior to becoming deficient in the winter. The capacity
balance is developed by determining firm resource capacity available at the annual system peak
load hour, including the Company's firm access to imports from the wholesale market (or "Front
Office Transactions"), less the system obligation and a l3 percent planning reserve margin.
6. The 2019 IRP shows that the Company's load and resource balance first becomes
capacity deficient in 2028 after early coal plant retirements. A summary of the system capacity
loads and resources are provided in Table No. l.
2 OrderNo. 32697,p.23
3 OrderNo. 32697,p.21
aJ
Table No. 1
20t9 rRP -Loads and Resources
7. After accounting for power purchase agreements ("PPAs") with QFs signed since
the preparation of the 20l9IRP and termination of QF PPAs originally included in the 2019 IRP,
the first capacity deficiency still first occurs in the summer of 2028, as shown in Table No. 2.
Table No.2
Loads and Resources U for PPA
8. Table No. 2 shows the first capacity deficiency of 829 megawaffs occurring in the
surnmer of 2028. The updated system capacity loads and resources in Table No. 2 include the
capacity contribution from four additional contracts (3 located in Utah, and I in Oregon), with a
total nameplate capacity of 290 megawatts. Four QF PPAs located in Oregon were terminated,
with a nameplate capacity of 38 megawatts. 1n2028 these updates contribute a net of I I megawatts
to system capacity.
9. Commission Stafffiled comments on the Company's 20l9IRP stating:
"The load and existing resource balance identifies resource deficiencies in the Company's
system acting as a starting point for developing and evaluating future resource portfolios.
A decision to close a plant early must be evaluated against other alternatives that maintain
4
Year 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
10,137 10,437 10,671 10,638 10,641 10,347 10,290 9,953 9,899 8,999
9,865 9,876 9,882 9,918 9,953 9,992 10,005 9,962 9,966 g,gE5
ll,l70 ll,l83 11,190 ll,23l 11,270 11,303 11,328 ll,28l 11,284 11,306 ll,32l 11,339
(1,033) (746) (sle) (sez) (630) (es6) (1,038) (1,328) (r,38s) (2,307) (2,827)
Resounes
0
a9 83838512
1,468 1,468 1,468 1,46E
18 t9t2 I t7
140
SyshmPosition
+ Rescncs
FlOTs
Srupfts @eticit)
I
1,45t 1,46t 1,46t 1,46t tAfi 1,46E 1,4680000000 1,468
0
8,494 8,270
9,998 10,014
Ycor 2019 2020 2021 20t2 2023 2024 2025 2026 2027 2028 2029 2030
435
0
0
0
838
25
(14)ll
512
25
(14)ll
a9
25
(14)ll
140
25
(14)ll
83
25
(t4)ll
(839) (1,359)25 25(14) (14)1l ll
435 708 934 K7 E49 523 40 151 94
876
6
(t 4)
/@eficicncy)
PPAs not in IRP
PPAs inIRP
4 t4
25
(14
llRcsourtes
Suffcicncy /
722
0
(14)
948
0
(14)
system reliability and should be made as part of the portfolio development and evaluation
phase of the IRP. Regardless of whether the closure decision is driven by economics or by
environmental compliance, one should choose the least cost altemative that maintains
system reliability, which likely requires additional replacement resource(s). The early
retirement and the replacement resources should be considered as a combined resource
decision and should only be included together so an accurate deficit date can be
determined."a
10. In reply comments the Company indicated that this issue would better be addressed
in the Company's capacrty suffrciency filing. Based on Staffs recommendation in the 2019 IRP
Table No. 3 removes the early retirement of thermal resources that were included in the Load and
Resource balances in Table No. 1.
Table No.3
System Capacity Loads and Resources
U for PPA and Thermal Retirements
I l. Based on the Company's 2019 IRP, Table No. 3 summarizes the system resources
updated for changes to QF PPAs since the IRP, excluding the early retirement of thermal resources
compared to system loads with a thirteen percent planning reserve margin. With these updates the
2019 IRP indicates that the Company will be capacity deficient during the summer of 2029.
a In the Matter of Rocly Mountain Power's 2019 Electric Integrated Resource Plan, Case No. PAC-E-I9-16, Order
No.34780.
5
2019 2020 2021 2022 2023 2024 2025Yeu
43s 70E 9r4 t67 r49 523 440 151 94
0
0
0
0
0
0
351
0
82
o
o
(,
156
201
0
0
0
a2
0
0
0
0
0
0
0
0
0
00
0
0
0
00000
o 0 (,0 0
(,0 0 o
000
0 0 0
0 0
2 356
74
74
0
0
0
0
(Ihfcicncy)
t@ttd SAR Rcsmcc Suff cicncy
I (Coal EarV Retbcmnt/Convenions)
thcmlttcd &rly lhcrml Rclircmtrts
I (Coal Fdy Retnemnt/Conversions)
2 (Coal Early Retiremnt/Convemions)
3 (CoatEarly Retircrent/Convesions)
4 (Cial Early RetirerEnt/Convesions)
I (Coal Early Rrtirerent/Convesions)
2 (Coal Fady Rotircmnt/Conv€sions)
Suffcicncy/Ilfclcncyr/oDrrlyRclircmnb 4fS 70E 9r4 E67 t49 E73 19O 941 965 l9l
0 351 7903Sl
Adjustmnt forDentes
(Cunlativc)871 1,019 1,271
Accordingly, the Company requests the Commission find the summer of 2029 as the first capacity
deficiency period when capacity payments should be made to a QF under the SAR calculation.
12. Rocky Mountain Power submits this Application to establish the capacity
deficiency period as set forth in Commission Orders No. 32697 and No. 328A2, and requests that
the Commission approve the capacity deficiency period to be used in its SAR calculations.
MODIFIED PROCEDTIRE
13. Rocky Mountain Power believes that a hearing is not necessary to consider the
issues presented herein and respectfully requests that this Application be processed under Modified
Procedure; i.e., by written submissions rather than by hearing. RP 201 et seq. If however, the
Commission determines that a technical hearing is required, the Company stands ready to prepare
and present its testimony in such hearing.
CONCLUSION
WHEREFORE, Rocky Mountain Power respectfully requests that the Commission issue
an order authorizing this Application be processed under Modified Procedure and approving the
capacity deficiency period beginning July 2029, to be used in the Company's avoided cost
determinations under the SAR methodology, as shown in Table No. 3 above.
DATED this 6ft day of October,2020.
ROCKY MOI.'NTAIN POWER
Emily
1407 West North Temple, Suite 320
Salt Lake City, Utah 841l6
Telephone No. [phone]
emi ly.wegener@pacifi corp.com
6